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TMI Blog2016 (7) TMI 815X X X X Extracts X X X X X X X X Extracts X X X X ..... for meeting the liability incurred by it under the leave encashment scheme proportionate with the entitlement earned by employees of the company, inclusive of the officers and the staff, subject to the ceiling on accumulation as applicable on the relevant date, is entitled to deduction out of the gross receipts for the accounting year during which the provision is made for the liability. The liability is not a contingent liability. - Decided in favour of assessee. Disallowance u/s 14A of the Act could be made while computing the book profit u/s 115JB - Held that:- As already in ground no.1 herein above that 1% of exempt income be adopted for the purpose of disallowance u/s 14A of the Act. We held that the same disallowance be made while co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pronouncements of the jurisdiction of the Income Tax Appellate Tribunal. 2. That, on facts as well as on law, the Ld. CIT(A)-XII, Kolkata has erred in confirming the disallowance of provision for leave encashment amounting to ₹ 16,40,000/- made by the Assessing Officer under section 43B of the Income Tax Act in disregard of the decision of jurisdictional High Court in the case of Exide Industries Ltd. (2921TR 470) and also the order of his predecessor, thus violating the rule of consistency. 3. That, on facts as well as on law, the Ld. CIT(A)-XII, Kolkata has erred in confirming the disallowance of ₹ 5,428/- alleged to be the expenses in relation to dividend income for the purpose of computation of "Book Profit" un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 43B(f) of the Act in the facts and circumstances of the case. 4.1. We have heard the rival submissions. We find that this issue is squarely covered by the decision in assessee's own case for A.Y.2008-09 in ITA No.1578/Kol/2012 dated 07.09.2015 wherein it was held as follows :- "6. We have heard the rival submissions and the citation quoted by the ld. AR. We find that it is relevant to get into the operative portion of the decision of Hon'ble Calcutta High Court in the case of Exide Industries Limited vs Union of India 292 ITR 470(Cal). It was held as under :- "11. In this regard the observation of the apex Court in the case of Bharat Earth Movers (supra) is quoted below: The law is settled: if a business liability has definitely ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion before the Hon'ble Supreme Court against the judgment of the Hon'ble Calcutta High Court. The High Court in Special Leave Petition to appeal (Civil) CC.12060/2008 dated 08.09.2008 had held as under :- "the petition was called on for hearing today. Upon hearing counsel the court made the following order. Issued notice. In the meantime, there shall be stay of the impugned judgment, until further orders." Later the Hon'ble Supreme Court in Special Leave to appeal (Civil) no.(s), CC- 22889/2008 dated 8.5.2009 had held as under :- "the petition was called on for hearing today. Upon hearing the counsel the court made the following order Delay condoned. Leave granted. Pending hearing and final disposal of the Civil Appeal, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case. 5.1. The ld. AR argued that 1% of exempt income as decided in ground no.1 herein above by placing reliance on the Hon'ble Jurisdictional Calcutta High Court may be kindly be adopted by computing the book profit u/s 115JB of the Act. In response to this, the ld. DR fairly agreed to this proposition. 5.2. We have heard the rival submissions. We have held already in ground no.1 herein above that 1% of exempt income be adopted for the purpose of disallowance u/s 14A of the Act. We held that the same disallowance be made while computing the book profit u/s 115JB of the Act as requested by the ld. AR. Accordingly ground no.3 raised by the assessee is partly allowed. 6. The other grounds raised by the assessee are general in nature and h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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